Zimbabwe News and Internet Radio

Zimra descends on tax defaulters

By Paul Nyakazeya

The Zimbabwe Revenue Authority (Zimra) has launched an operation targeting companies and individuals that have defaulted on their tax obligations. This comes as the national tax collector’s July gross collections increased by 20,80 percent to $406,13 million from its monthly target of $336,20 million.

ZIMRA offices in Harare (Picture by smezim.com)
ZIMRA offices in Harare (Picture by smezim.com)

However, Zimra believes that many clients are yet to register for the relevant tax heads such as Income Tax, Pay As You Earn (PAYE) and Value Added Tax (VAT) as well as submitting tax returns by due dates, pay tax by due dates and submitting accurate and complete declarations.

“In order to assist clients who have not been able to comply with these statutory requirements, Zimra will be carrying out follow-ups throughout the country to check on compliance,” the revenue collector said yesterday.

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Tax returns need to be completed in full and be submitted on time through the Zimra e-service platform.

“Zimra would appreciate if the clients who have not yet complied can voluntarily attend to the outstanding tax obligations before the follow-ups. The commissioner general has already offered to consider waivers on penalties for those who voluntarily comply,” the government department said.

In July Zimra’s net collections were $372,58 million after deducting refunds amounting to $33,55 million, translating to a positive variance of 10,82 percent. In the same period last year, $286,49 million was realised, implying that revenue collections grew by 30,05 percent this year.

Collections of $62,73 million from the individuals head were 11,36 percent below the target of $70,77 million. The revenue head experienced a negative growth of 3,37 percent, compared to the same period last year.

According to the July revenue report, strategies to improve the revenue head’s performance include tax audits that are both corrective and deterrent aimed at encouraging voluntary compliance.

They also include increased taxpayer education and debt management strategies including write offs of uncollectable debt and waiver of penalties and interest.

Gross VAT on local sales of $89,87 million were 13,04 percent above the $79,50 million target, with net collections after deducting current refunds of $33,40 million, amounted to $56,47 million.

Gross customs duty collections rose to $42,36 million against a target of $29,70 million, implying a positive variance of 42,62 percent. The positive performance is attributed to increased imports mainly motor vehicles, parts of machinery and lubricating oils.

Similarly, revenue collections from excise duty were $69,50 million against a target of $68,87 million.

Major contributing sub-revenue heads were fuel, airtime and beer, which contributed 69,28 percent; 12,77 percent and 10,90 percent respectively.

Zimra expects the positive trajectory to continue owing to “improved corporate profitability and a seemingly re-emerging general demand”. — The Financial Gazette